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Spotify Technology S.A. SPOT is set to report its fourth-quarter 2024 results on Feb. 4, before the bell.
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The Zacks Consensus Estimate for earnings in the to-be-reported quarter stands at $1.92 per share, indicating 592.3% year-over-year growth. The consensus mark for revenues is pegged at $4.35 billion, indicating year-over-year growth of 10%.
Two estimates for the to-be-reported quarter moved down over the past 30 days versus one upward revision. Over the same period, the Zacks Consensus Estimate for fourth-quarter 2024 earnings has decreased by 3%.
SPOT’s earnings surprise history has not been impressive. Earnings lagged the Zacks Consensus Estimate in two of the four trailing quarters and surpassed twice, the average negative surprise being 74.4%.
Spotify Technology Price and EPS Surprise
Spotify Technology price-eps-surprise | Spotify Technology Quote
Earnings Whispers
Our proven model doesn’t conclusively predict an earnings beat for Spotify this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Spotify has an Earnings ESP of -16.45% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Factors Shaping Upcoming Results
The growth of subscribers and monthly active users (MAU) is likely to have benefited the top line in the to-be-reported quarter, directly benefiting the bottom line as well.
The consensus estimate for total MAUs is pegged at 665.3 million, indicating year-over-year growth of 10.5%. The consensus estimate for total ad-supported MAUs stands at 420.2 million, indicating year-over-year growth of 11%. The consensus mark for premium subscribers stands at 260 billion, indicating year-over-year growth of 10%.
Price Dynamics
SPOT has rallied a massive 150% over the past year, 57% over the past six months and 20.4% in the past month. These price dynamics suggest that the stock is in a rally phase.
Conclusion
While SPOT’s current growth prospects appear robust, potential investors should consider waiting as the stock may undergo a correction, especially when it does not seem poised for an earnings beat. SPOT's long-term growth potential remains strong, making it a compelling stock to watch for the right investment opportunity.
Stocks That Warrant a Look
Here are a few stocks from the broader Business Services sector, which, according to our model, have the right combination of elements to beat on earnings this season.